Article
Money can be a touchy subject, but it doesn’t have to be. By discussing it more, we can share helpful tips and become more informed. TikTok finance expert Pattie Ehsaei, with over 22 years of experience, highlights the most common financial mistakes Americans make. She focuses on the #1 worst mistake and offers advice on how to improve money habits.
The Biggest Mistake
Ehsaei tells Parade that the biggest financial mistake Americans make is not planning for the future, especially for retirement. The social security trust fund might run out by 2034, so people can’t rely on it for retirement. Many Americans don’t think ahead about their financial future.
How to Fix It
Ehsaei suggests starting with a budget. There are many budgeting apps available to help. Without a plan, financial goals are hard to reach. She recommends using the 50/30/20 rule: 50% of income goes to needs, 30% to wants, and 20% to savings and investments. Automating these allocations can prevent overspending and ensure retirement savings.
Other Common Mistakes
- High-interest debt: Many Americans accumulate debt and don’t pay it off quickly, leading to financial strain due to interest.
- Lack of emergency fund: Not having savings for unexpected expenses can result in taking on debt.
- Impulse spending: Making unplanned purchases without thinking about long-term financial goals is a common issue.
Changing Financial Habits
If you’re struggling with poor financial planning, you’re not alone. Here are some tips to help:
- Change Your Mindset: Ehsaei advises viewing money as a tool to achieve goals, not a source of stress.
- Learn Strategies: Educate yourself on smart financial strategies to understand your decisions and their benefits.
- Ask for Help: If you need assistance, seek advice from a financial advisor or counselor.
Conclusion
With Ehsaei’s tips, you can manage your day-to-day expenses better and prepare for retirement. For more detailed advice, check out the full article on Parade.
https://parade.com/living/worst-financial-mistake-americans-make-according-to-a-finance-expert